Corporate Transparency Act is Unconstitutional Ruling

Published: Mar 5, 2024
By: Jeffrey Kelson
Topics: Tax
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On March 1, 2024, a federal district court judge ruled that the Corporate Transparency Act (“CTA”) is unconstitutional; holding that Congress does not have the constitutional authority to regulate entities “the moment they obtain a formal corporate status from a State.”

The court ordered a permanently enjoined enforcement of the act by the Treasury, FinCEN, or any other agency against the plaintiffs. Treasury and FinCEN have stated that they will not enforce the CTA against members of the NSBA, provided they were active members on or before March 1, 2024. The government filed an appeal with the Court of Appeals for the Eleventh Circuit on March 11,2024. Those who think they may be impacted by this decision should reach out to legal counsel for guidance.

For our previous discussion of the CTA and the beneficial ownership reporting requirements, see here.

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Jeffrey Kelson

Jeffrey Kelson is the Co-Leader of the firm’s National Tax Office and a leader in the New Jersey office, bringing 30 years of experience to his role. He also heads the firm’s Tax Thought Leadership initiative.

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